China's Small and Medium Enterprises (SMEs) Development Index, based on a survey of 3,000 SMEs, edged down 0.3 points from the previous month to 88.3 in April, the latest industry data showed.
This is the third consecutive month of decline for the gauge, which is lower than that of the same period last year, said the China Association of Small and Medium Enterprises.
Halted production due to domestic COVID-19 outbreaks, coupled with industry chain disruptions and high commodity prices, has made it more difficult for some companies to cover costs, said the association.
The sub-indexes for industry, construction, transportation and postal services, wholesale and retail, as well as hospitality and catering retreated from a month ago, while that for real estate increased.
The industry group calls for targeted support to virus-hit small businesses in the service sector, implementation of policies like tax and fee cuts, as well as efforts to keep prices and employment stable.